Samvardhana Motherson to acquire Nexans Auto’s wiring harness biz for 207 mn euros; stock hits 52-week high

Shares of Samvardhana Motherson International Ltd (SAMIL) rose 1% in the opening trade on Tuesday after the automotive components maker announced a proposed acquisition of Nexans Autoelectric’s wiring harness business. The enterprise value of the transaction is 207 million euros on a cash- and debt-free basis, with final consideration to be adjusted for cash, debt and working capital at closing.

Boosted by the development, Samvardhana Motherson shares climbed as much as 1.07% to hit a 52-week high of ₹122.35 on the BSE. The auto ancillary stock has rebounded nearly 71% from its 52-week low of ₹71.57 touched on April 7, 2025.

At the time of reporting, Samvardhana shares were down 0.6% at ₹120.30, with a market capitalisation of ₹1.27 lakh crore, paring opening gains. Meanwhile, the equity benchmarks – BSE Sensex and NSE Nifty – were down up to 0.2% each.

In an exchange filing last evening, SAMIL announced a proposed acquisition of a 100% stake in Nexans Autoelectric GmbH and Elektrokontact GmbH through its wholly owned subsidiary, Motherson Global Investments B.V. The transaction will be executed through a series of share and asset purchase agreements and is targeted for completion in Q1 FY27, subject to regulatory approvals and employee consultations, the company said in a release.

“The potential transaction follows entering into exclusive negotiation and signing of a master framework agreement, under which a series of shares and asset purchase agreements will be executed to transfer interests in multiple subsidiaries and assets in Autoelectric,” it said.

Nexans Autoelectric, a global automotive wiring harness manufacturer with over six decades of operating history, reported revenue of 749 million euros in CY24 with an EBITDA margin of around 6.4%. Passenger vehicles accounted for 81% of revenues, with the remainder coming from commercial vehicles. More than half of its revenue is derived from premium OEMs such as BMW and Mercedes-Benz, followed by Volkswagen, Audi and Porsche.

Deal receives positive response from brokerages

The deal has received positive response from brokerages, which see the move as strategically important for expanding SAMIL’s global passenger vehicle footprint and strengthening long-term earnings visibility.

Nomura believes the acquisition is a strong strategic fit for SAMIL, helping it enter the global passenger vehicle wiring harness space—an area where it had limited presence earlier. Nexans Autoelectric’s expertise in low- and high-voltage powertrain harnesses, body harnesses and specialised components is expected to complement SAMIL’s existing portfolio, while also enabling cross-selling opportunities and deeper engagement with global OEMs.

The deal also expands SAMIL’s geographic footprint across Europe, North America and Asia, it said. It noted that the acquisition is attractively valued at around 4.3x CY24 EV/EBITDA and could result in EPS accretion of about 2% in the first year itself.

Given the strategic importance of the deal, expected synergies and long-term growth visibility, it has reiterated a ‘Buy’ rating on Nomura shares, maintaining a target price of ₹1,270, valuing SAMIL at 19x earnings.

Motilal Oswal said the Nexans Autoelectric transaction marks SAMIL’s first acquisition in the passenger vehicle wiring harness segment after its demerger and opens up a new growth avenue for the company over the coming years. The brokerage noted that the deal aligns well with SAMIL’s long-term strategy to diversify its revenue base under its 3CX10 vision and offers meaningful synergies due to complementary product offerings and customer profiles.

On the outlook, Motilal Oswal expects SAMIL to continue outperforming global automobile sales, driven by rising premiumisation and the EV transition, a strong order backlog across auto and non-auto segments, and successful integration of recent acquisitions. While tariff-related issues could cause a near-term slowdown in some key geographies, the brokerage believes SAMIL will be relatively insulated given its manufacturing footprint close to customers and its ability to realign supplies. It added that potential industry consolidation could further benefit large players such as SAMIL over the long term.

Motilal Oswal has also reiterated its ‘BUY’ rating on the stock with a target price of ₹129, valuing SAMIL at 24x Sept’27E EPS.

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